The Toyota RAV4 may soon be Toyota's best-seller.
After several tenuous months, U.S. new car sales slipped back on their record track in November, and while it’s likely the industry has hit the peak of the current economic cycle, demand is likely to remain strong for several more years, forecast the U.S. head of automotive operations for Toyota.
What consumers will be buying is another matter, according to Senior Vice President Bob Carter, who stressed that the shift from conventional passenger cars to utility vehicles and other light trucks “is going to continue to accelerate in the future.”
Barring a sudden slowdown of the American market, sales should just nip past last year’s all-time record of around 17.5 million, said Carter, during a meeting with journalists in Detroit. “By anyone’s estimation,” he said, “that’s fantastic.”
(Click Here for a closer look at November car sales.)
Exactly what will happen next has been a matter of debate for months, and the turmoil that has followed the November presidential election is only further muddying the view through industry crystal balls.
On the whole, industry analysts such as J.D. Power and Associates and IHS Automotive, expect to see 2017 bring the first downturn in the market since the industry recovery began in 2011. But while Toyota VP Carter agrees “We may be over the top, (we) still have a very healthy year in front of us.”
Even the Toyota Land Cruiser has been gaining sales.
He expects the numbers will remain above the 17 million mark for 2017, adding that he also “remains optimistic” for sales pushing out as far as 2019.
The November numbers have clearly helped fuel such optimism. But so have some other economic indicators, including the latest U.S. jobs report which showed unemployment dropping to its lowest level since well before the Great Recession.
Parsing the auto sales numbers also reveals there was strong demand for large pickup trucks – Ford reporting a 10% jump in sales for the F-Series line. Such models are heavily dependent upon commercial buyers, such as contractors, and such demand potentially portends confidence the economy will remain solid.
The test will come in the months ahead, however, as it will be up to the new Trump Administration to quell concerns raised by many economists, as well as to find ways to reunite an electorate sorely divided by an unusually contentious election.
Whether or not the overall U.S. car market can maintain momentum, its make-up is expected to continue shifting. Utility vehicles – both classic SUVs and newer crossovers – pickups, vans and other light trucks now account for more than 60% of all new vehicle sales. During his visit to Detroit, Toyota’s Carter was confident the pace of change isn’t yet ready to slow down. If anything, motorists are still hammering the throttle.
That’s been particularly apparent in Toyota’s own sales. Bill Fay, head of the Toyota brand in the U.S., told TheDetroitBureau.com that the maker could have sold thousands more of its light truck models if it had the capacity in place. That includes such popular vehicles as the Highlander, with even the top-line Land Cruiser SUV posting strong year-over-year sales gains.
(Toyota set to reveal radical makeover of Camry sedan at Detroit Auto Show. Click Here for a sneak peek.)
Toyota offers a hint of the new Camry model it will reveal at the North American International Auto Show.
If the current trend holds, in fact, Toyota officials say there is a very solid chance that the compact RAV4 will soon push past the Camry, which has long been both the best-selling Toyota model line and the number one midsize sedan in the U.S.
“My goal is Camry will always be the number one-selling sedan in North America,” said Carter, “but (the compact crossover) RAV4 could be Toyota’s number-one best-seller” overall in the American market.
Toyota has been relying on its flexible manufacturing system, especially within its North American production network, to adapt to the ongoing shift, cutting back passenger car output while boosting light truck volumes, Carter and other officials noted.
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